Measuring nonprofit success requires analyzing many metrics

February 5, 2014

Measuring nonprofit success requires analyzing many metrics

While all companies measure success in multiple ways, profits tend to be the determining factor. Most of the actions of a for-profit company are carried out to make more money. Improving customer satisfaction and creating innovative new products lead to greater profits – they are tools for success. The nice thing about measuring success with dollars and cents is it provides a set of numbers that can be used as metrics.

For nonprofit organizations, success or failure is far more subjective. While profits are obviously not the measure of success, the need to keep the organization viable is still a determining factor. Serving the designated community or industry cannot be done without successful funding. For this reason, it is very important that nonprofits set clear goals when determining what constitutes acceptable service in their area.

How to measure success when profit isn't applicable
Success and failure should be measured by looking at the organization as a whole. When analyzing metrics, look to see how they compliment one another:

  • Fundraising goals: A viable nonprofit sets very specific fundraising goals at the beginning of the year. The goals are based on realistic estimates of what the organizations can bring in and how much money is needed to function and grow. Even if fundraising came up a little short, consider it a success if you were still able to meet demand for service.
  • Charity provided: For nonprofits that provide services to the less fortunate, it can be difficult to determine if the job is getting done. Should a food shelter wipe out world hunger, or merely provide a low-cost option for families that are experiencing a rough time financially? Like fundraising goals, service goals should be realistic.
  • Growth: An increase in size is not always a measure of success for a nonprofit. If current levels of service are adequate, nonprofits shouldn't feel compelled to spend money. Shore up reserves for when times are lean or begin saving for needed costs down the road, such as a new building or equipment.

Each year, how a nonprofit measures success will depend on the goals of board members and employees. The balance sheet alone cannot determine if an organization was an asset to the community that it serves. Success can be measured in many ways, only individuals within the organization can determine if their nonprofit is operating to the best of its ability.


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Lutheran Services Carolinas, Salisbury, NC

My experience with FNP has been wonderful. Unemployment in general is quite confusing and FNP has simplified the process for us. Everyone we have reached out to or worked with has been very helpful and follows up to be sure we understand the information. I am so happy we made the switch to FNP!

Stone Valley Community Charter School, Huntingdon, PA

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Jewish Silicon Valley, Los Gatos, CA

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American Saddlebred Horse & Breeders Association, Inc., Lexington, KY

I would like to comment on my experience with FNP….to date our District has saved $1,000’s of dollars by being enrolled in the First Nonprofit program. My only regret is that we did not know about this method of paying unemployment tax years ago….as I had figured about five years

ago, had we enrolled 15-20 years ago, we could have saved our small school district upwards of $500,000 in payments to IDES. Also we would have had a pretty hefty sum of money in our Reserve Account. Thankfully I attended a workshop hosted by First Nonprofit back in 2015 which got the ball rolling!

Beardstown Community Unit School District 15, Beardstown, IL

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Visually Impaired Preschool Services, Louisville, KY

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Neurologic Music Therapy Services of Arizona, Phoenix, AZ